(Corrects to change the description of Polymetal
International Plc in the 18th paragraph of the story published
on June 28 and 29.)

June 28 (Bloomberg) -- European stocks posted their first
weekly advance since May 17 as China took steps to ease a cash
crunch and U.S. data boosted optimism the global economy can
withstand a paring of central-bank stimulus.

Mediaset SpA jumped 15 percent as Credit Suisse Group AG
raised its price target for the shares. Debenhams Plc rallied
the most since 2011 after saying it maintained sales even as
cold weather reduced spending on summer clothing. Afren Plc rose
8 percent after saying oil found off the coast of Nigeria may
exceed its estimates. Pandora A/S, which makes gold and silver
jewelry, jumped 11 percent as precious metals tumbled.

The benchmark Stoxx Europe 600 Index rose 1.7 percent to
285.02 this past week, snapping five weeks of losses. The gauge
still posted its first monthly drop since May 2012 and closed
the quarter with a 3 percent decline. It has retreated 8.2
percent since May 22 after Federal Reserve Chairman Ben S.
Bernanke said the central bank could reduce quantitative easing
if the U.S. economy improves sustainably.

“Assuming we see positive economic data for the next few
months, then what you should see is a market that can hand off
from life support towards some underlying growth,” Alex
Friedman, chief investment officer at UBS AG’s wealth-management
unit told Francine Lacqua this week. “China said essentially
that it wants to make sure it doesn’t have a bubble on the
credit side, and they clamped down a little bit. That’s a good
thing.”

The VStoxx Index, which measures the cost of using options
to hedge against swings in the Euro Stoxx 50 Index, fell 9.3
percent this week, halting five consecutive weeks of gains.

China Turbulence

China’s money-market rates eased after the People’s Bank of
China said it provided funding to some financial institutions to
stabilize interbank lending rates and will use short-term
liquidity operations and existing loan-facility tools to steady
the market. The rates had surged in the week through June 21.

The measures pushed the seven-day repurchase rate lower to
6.16 percent from a record 12.45 percent on June 20, according
to data from the National Interbank Funding Center. The one-year
interest-rate swap slid 44 basis points to 3.97 percent, data
compiled by Bloomberg show. It reached an all-time high of 5.06
percent in intraday trading on June 20.

Fed Presidents

In the U.S., Atlanta Fed President Dennis Lockhart said
investors may have overreacted to Bernanke’s comments on a
potential reduction in stimulus. William C. Dudley, president of
the Fed Bank of New York, said any decision to slow the pace of
asset purchases wouldn’t represent a withdrawal of stimulus.

Separately, Richard Fisher, president of the Dallas Fed,
and Minneapolis Fed President Narayana Kocherlakota emphasized
that the central bank isn’t rushing to take away the stimulus.

Investors watched U.S. data this week to help gauge the
strength of the world’s biggest economy. Reports showed consumer
confidence, orders for durable goods, and sales of new and
previously owned homes increased more than economists had
predicted. Still, a June 26 report showed slower-than-estimated
U.S. economic growth for the first quarter.

Industrial output in Japan rose 2 percent in May, the most
since December 2011, a report showed. That beat the median
projection in a Bloomberg survey for a 0.2 percent gain from the
previous month.

Elsewhere, European Central Bank President Mario Draghi
said in a June 25 speech that the euro-area economy still
requires a loose monetary policy from the central bank.

Advertising Markets

Mediaset rallied 15 percent as Credit Suisse raised its
price target on the broadcaster to 4.40 euros from 2.65 euros.
The brokerage cited growing evidence that the television-advertising markets in Italy and Spain have bottomed.

Debenhams gained 8.8 percent, its largest weekly advance
since December 2011. JPMorgan Chase & Co. upgraded its rating on
the stock to overweight, a recommendation similar to buy, from
neutral. The bank cited a robust quarter for the U.K. retailer
amid what was a difficult period across the industry. Sales at
stores open at least a year were unchanged in the 16 weeks ended
June 22, the London-based retailer said.

Afren rose 8 percent. Drilling tests at the Ogo-1 well in
the Gulf of Guinea showed hydrocarbon resources that may exceed
the company’s initial estimates. Afren holds about 23 percent of
the block where the well is located.

Pandora jumped 11 percent, extending its 2013 rally to 56
percent. Jyske Bank A/S raised its recommendation on the stock
to buy from reduce, saying the company’s profit margin may widen
as gold and silver touched their lowest prices since August 2010
this week.

Precious Metals

Polymetal International Plc, which operates gold and silver
mines in Russia and a gold-and-copper mine in Kazakhstan,
tumbled 14 percent. Gold posted its biggest quarterly drop since
at least 1920, while silver plunged the most in 32 years this
quarter.

A gauge of mining companies posted the only decline among
all 19 industry groups on the Stoxx 600. Fresnillo Plc and
Randgold Resources Ltd. fell 3.2 percent and 2.9 percent
respectively, while Anglo American Plc lost 6.4 percent.

Subsea 7 SA retreated 16 percent as the oil-field services
provider said its earnings will fail to grow this year. The
Norwegian company increased its estimate for the full-life loss
on the Guara-Lula project off the coast of the Brazil.

Lanxess AG slumped 7.8 percent as China said it will levy
an anti-dumping duty on toluidine imports from the European
Union for five years. The chemical manufacturer will pay a
charge of 19.6 percent in China, according to the Chinese
Ministry of Commerce.